In brief - Employers should consider health and safety risks and take steps to avoid being held vicariously liable 

There is plenty of reason to celebrate in Australia at present, given the tremendous effort each State and Territory has made in reducing or eliminating the spread of COVID-19. However, COVID was the grinch who stole many office Christmas parties this year, with most employers cancelling or scaling down large scale workplace Christmas functions.

Nevertheless, with smaller scale Christmas events occurring in the workplace this month, the lack of social interaction many employees have experienced while working from home for months on end may well cause some employees to partake in a little more Christmas cheer than the law permits. 

Follow the tips below to make sure your festive workplace parties don’t start with Santa saying “ho ho ho” only to end with him saying “no no no”!

Vicarious liability in workplace legislation 

It is well established that work social functions, even if held outside standard work hours and away from work premises, are sufficiently “connected” to the workplace such that any unlawful behaviour - for example, bullying, fighting or sexual harassment - engaged in by employees at those functions can be the subject of a workplace complaint or litigation. 

Most workplace legislation, for example, discrimination and sexual harassment laws, have provisions that allow the employer to be held “vicariously liable” for the conduct of its employees if the employer has not taken reasonable steps to prevent the unlawful behaviour from occurring. These laws usually extend coverage to work corporate events and even parties occurring after official events have ended.

Case examples 

Here are some classic Christmas party horror stories from the industrial archives:

  • An employee was dismissed after he urinated over the side of a restaurant balcony on to diners below at his employer’s Christmas party. Astonishingly, after he was dismissed for the behaviour he lodged a claim alleging his dismissal was unfair! 

  • An employee was dismissed for sexual acts in front of several other employees in a hotel room booked by a group of employees, after the end of a Christmas party organised by the employer.

  • Four employees were prosecuted and fined by WorkSafe for breaches of occupational health and safety laws when an employee suffered severe burns at a Christmas party when another employee sprayed paint thinner onto his colleague’s bare torso, which then caught fire as a result of the flame from an already ignited spray can.

  • An employee was injured by a propeller after being pushed off a boat by another employee at a Christmas party. The employer was found liable for the injury.

  • A golf club was held liable for the conduct of its president who sexually harassed a female employee of the club at the end of year Christmas party.

Top 7 take away tips to mitigate legal risks 

To ensure your end of year function does not result in workplace complaints and litigation, employers should consider taking the following measures when preparing for and managing end of year corporate functions and events in the workplace:

  1. Make sure social distancing and density requirements in venues are complied with and that COVID-safe guidelines relevant to the State or Territory are adhered to at all times. Indoor venues should be spacious and well ventilated. Outdoor venues are likely to be the safest. Gatherings should be kept small. Activities that compromise physical distancing should be avoided, such as dancing and karaoke. 

  2. Ensure that the organisation has in place current policies on equal opportunity, sexual harassmentbullying and workplace health and safety. Issues at Christmas parties generally fall into one of these categories. Policies should be reviewed now for compliance with current judicial expectations, as defective policies will be no defence. The policies should form contractual terms referenced in employment contracts. Circulate and reinforce workplace policies, and the Code of Conduct if you have one, prior to the end of the year.

  3. Ensure responsible service of alcohol. In McDaid v Future Engineering and Communication Pty Ltd [2016] FWC 343, the Fair Work Commission (FWC) held that employers must “take steps” to ensure that they serve alcohol responsibly. As the FWC does not always assume adults can be responsible for themselves, employees and others present should not be allowed to become heavily intoxicated. Consider sending unruly employees home in a taxi before anti-social behaviours develop. 

  4. The corporate function should have a designated finish time taking into account the length of time employees have been present. Make sure no one who has been consuming alcohol has to drive home. Provide transport or cab vouchers.

  5. Designate someone to monitor hazards. In Keenan v Leighton Boral Amey NSW Pty Ltd [2015] FWC 3156, the FWC encouraged employers to appoint a manager to supervise the conduct of work events to avoid mishaps. Make sure the designated person is sober and is able to monitor and attend to occupational health and safety hazards at the Christmas party, such as wet floors, broken glass and loose electrical cables.

  6. Remind all staff by email before the Christmas party of the standards of behaviour expected of staff at workplace functions (including the need to comply with COVID-safe guidelines) and the disciplinary consequences of failing to meet those standards, as provided in relevant policies. Employees should understand that just because the work function may be outside of standard working hours and may be at a non-work venue, normal workplace standards of behaviour continue to apply.

  7. If all of the above seems too much trouble, consider a virtual disco or virtual karaoke instead! 

This is commentary published by Colin Biggers & Paisley for general information purposes only. This should not be relied on as specific advice. You should seek your own legal and other advice for any question, or for any specific situation or proposal, before making any final decision. The content also is subject to change. A person listed may not be admitted as a lawyer in all States and Territories. © Colin Biggers & Paisley, Australia 2021.